The opinion of the court was delivered by: BARD
This action was brought to obtain a refund of a portion of the federal estate tax paid by plaintiff as the executor of the Estate of Algernon R. Clapp. I make the following special findings of fact:
1. B. Frank Clapp died in 1914, survived by his wife, Clara B. Clapp, and his son, Algernon R. Clapp.
2. By his will, B. Frank Clapp created a trust, half of the income of which was payable to Clara B. Clapp for life and the other half (and after the death of Clara B. Clapp, the whole thereof) to Algernon R. Clapp or his issue. The trust was to terminate upon the deaths of Clara B. Clapp and Algernon R. Clapp and upon the attainment of the age of twenty-one by all of the children of Algernon R. Clapp, when the principal was to be distributed to the children of Algernon R. Clapp per stirpes.
3. The will of B. Frank Clapp further granted to Algernon R. Clapp a power of appointment over the share of the income which he was receiving at the time of his death and over one half the principal.
4. Algernon R. Clapp died April 20, 1938, and was survived by his mother, Clara B. Clapp, his wife, Anne J. Clapp, and two daughters, sixteen and seventeen years old.
5. By his will, Algernon R. Clapp expressly exercised the power of appointment by appointing the income to his wife for life and the one half of the principal over which he had a power of appointment to a trust, the income from which should be payable to his wife for life and the principal of which should be distributed at her death to his then surviving children or their issue per stirpes.
6. The value of the interests in the portion of the B. Frank Clapp estate which Algernon R. Clapp appointed to his daughters was $112,925.08.
7. The federal estate tax which plaintiff paid as a result of the inclusion of the value of the above interests in the gross estate of Algernon R. Clapp was $19,326.87, which sum with interest of $1,418,01 plaintiff paid to defendant on October 19, 1940.
The question presented by this case is whether the Commissioner of Internal Revenue was authorized by Section 302(f) or Section 302(a) of the Revenue Act of 1926 as amended, 26 U.S.C.A. Int.Rev. Code, § 811 (a, f), to include as part of the gross estate of Algernon R. Clapp, subject to the estate tax, the interests acquired by his daughters upon his death.
"The value of the gross estate of the decedent shall be determined by including the value at the time of his death of all property -- * * *
"(f) To the extent of any property passing under a general power of appointment exercised by the ...